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Careers in Finance

A smaller percentage, about 15 percent, of salaried toward direct-mail and telephone sales campaigns. One
employees in the insurance industry is made up of sales- area of growth in this industry is that of financial services
people, often called insurance brokers or insurance agents, and products sales. Another growth area stems from the
who focus on selling insurance policies to businesses and need to cover large liability awards resulting from lawsuits.
individual customers. Insurance agents can sell insurance Finally, the number of claims professionals will grow faster
exclusively for one insurance company or insurance poli- than any other position in the industry because of the
cies issued by several different insurance companies. Some need for better customer service and actual inspection of
of the typical types of insurance polices an agent or broker damaged property or consultation with doctors.
may sell include health, life, annuities, property, casualty,
and disability. In addition to these services, some agents
SECURITIES AND COMMODITIES
are now licensed to sell mutual funds, annuities, and secu- CAREERS
rities.
There are large numbers of workers in this area of the
An even smaller career field in the insurance industry
is the area of actuary science. Although there may not be finance industry. The national brokerage companies have
extensive systems of branch offices throughout the coun-
as many actuaries as there are salespeople in insurance, try; as a result, these brokerage firms employ the majority
they are very important to the industry. Actuaries set rates of the workers in this industry. Headquarters for these
paid by customers at a level where the premiums that are
firms are located in New York City, where most of the
collected will generate enough money to cover the claims
executives and support personnel work. Mutual fund
that are paid out. Yet the premiums cannot be too expen-
sive or customers will switch to other insurance compa- management companies and regional brokerages also
nies. Actuaries accomplish this by studying the probability employ many people. Although it is very well known, the
of an insured loss and the premium rates of other insur- New York Stock Exchange actually employs a small num-
ance companies. ber of people compared to the rest of the industry.
A great deal of attention is focused on tracking per-
Education requirements for jobs in the insurance
formance, transactions, and the value of investments. Bro-
industry vary, depending on the position and its responsi-
bilities. Many of the entry-level clerical positions in the kerage clerks are responsible for the majority of the daily
insurance industry require only a high school diploma. operations and for processing much of the paperwork that
Higher-level executive, managerial, and sales positions is generated. These positions are often considered entry-
require more education, with employers usually preferring level jobs with the potential for promotion into securities
to hire college graduates. Most managerial positions are sales and even into higher positions. For example, a sales
filled by promoting people from within the organization. assistant takes calls from clients, writes up the order,
Such employees usually have a college education, some processes the paperwork, and keeps clients updated on
special training in the insurance industry, and experience their portfolio’s performance. With experience and a
with the company. Actuaries typically have a college license to buy and sell securities, brokerage clerks can be
degree in actuary science, math, or statistics. After com- promoted into higher-level sales positions.
pleting college, actuaries must pass a series of exams over The largest number of people employed in the secu-
a period of five to ten years to become fully qualified. rities and commodities industry can be found in three
Overall, advancement opportunities are good in the insur- occupations: securities, commodities, and financial serv-
ance industry. ices sales. These careers involve buying and selling shares
Earnings for insurance clerks and clerical staff are of stocks, mutual funds, and other financial services. The
below those of insurance examiners, adjusters, and inves- majority of these workers are sales representatives who
tigators. Higher annual salaries are typical for higher-level work directly with individual investors. They are known
general managers and top executives. Salaries for sales as brokers, account executives, or financial consultants.
agents are difficult to pinpoint because many are paid a Securities and commodities brokers differ in the invest-
salary, plus commissions and plus bonuses for reaching ments they buy and sell. Securities brokers typically buy
sales goals. In addition, an agent’s earnings will rapidly and sell stocks, bonds, and mutual funds. Commodities
increase as he or she gains experience and develops a client brokers buy and sell futures contracts for metals, energy
base. supplies such as oil, and agricultural products. In addition
The employment rate for the insurance industry is to buying and selling securities, brokers can advise and
projected to increase more slowly than the average for all educate their clients on investments, saving for retire-
industries combined. Job growth in the insurance field is ment, and tolerance for risk. Overall, brokers spend a
expected to be limited by the downsizing of large insur- great deal of time marketing their services and products in
ance companies, computerization, and a trend that points order to establish a strong customer following.

ENCYCLOPEDIA OF BUSINESS AND FINANCE, SECOND EDITION 89